Toe the Line: College Republicans | A good opening statement, but not the final word

By Michael Moroz 03/19/17 10:08pm

Obamacare is a disaster.

This has become an unavoidable reality in recent years. In Michigan and Colorado, for instance, premiums are increasing at rates of 16.7 percent and 20 percent, respectively. Nationally, premiums rose 25 percent this year on average. Some counties don’t even have multiple insurance companies on the exchanges.

Speaking to an Aetna employee made me feel like a counselor; after all, the company has been in a “death spiral” as a result of the Obamacare exchanges. Only half of the projected 25 million enrollees have materialized. Any promise of deficit neutrality has long been forgotten; “not one dime” to the deficit changed very quickly to a trillion dollars in deficit spending. The Obamacare “penalty” for not purchasing insurance became a tax overnight, when it was convenient for the president to portray it as such in court.

This is by no means a shocking outcome to Republicans, who opposed the bill unanimously in Congress. A system that depends on coercing a group of largely healthy and young people to buy expensive insurance they don’t want or need in order to subsidize other sectors of the population is bound to fail. Guaranteeing coverage for those with pre-existing conditions and putting caps on premium costs for the elderly further increased this burden, and the Affordable Care Act ultimately collapsed as a result.

What’s nearly as troubling as the bill’s practical impacts is the seemingly permanent blow to public confidence that it engendered. President Obama and his allies promised, ad nauseam, that families would save $2,500 a year on average. Infamously, President Obama promised that Americans would not lose their plans — between 3 and 5 million did, with their insurance replaced by generally expensive, arguably unnecessary and certainly unwanted plans.

The American Healthcare Act is by no means perfect. It does not eliminate many of the regulations in Obamacare, apparently because Republicans are worried about a resulting filibuster. It also keeps the well-intentioned but illogical policies regarding health care costs for the elderly and pre-existing conditions. Buying health insurance to cover a condition that already exists, with no impact on cost, is kind of like buying life insurance for the deceased; it’s an entitlement, not insurance.

The bill keeps the tax-free status of employer-provided health care — while this FDR-era policy disincentivizes individuals from purchasing insurance, the solution is to expand tax credits to the individual market, not to eliminate them completely. The current bill does this by issuing age and income based refundable tax credits for individuals buying insurance.

While the aforementioned reservations are real and legitimate, it is important to note that this bill is but one step in the GOP’s three-step health care reform effort. This one step would, according to CBO figures that are being celebrated by the left, lower premiums by 10 percent, while cutting taxes by $883 billion. It would also decrease the deficit by $337 billion.

The most common line of attack against the bill is the claim that over 20 million people will lose coverage. While facially true, most of the initial decline in coverage will be caused by the repeal of the individual mandate. Alternatively stated, people who didn’t want insurance will no longer be forced to purchase it, leading to a decline in coverage. The mission of Congress and the president is to try and lower costs to the point that purchasing insurance is economically rational.

It was, admittedly, unwise for Republicans to unveil one part of the reforms and to keep the public waiting on the other two. Regardless, this bill is an imperfect step in the right direction, away from government control of the health care system. Hopefully Republicans on the hill can get past their infighting and deliver a refined and improved set of bills moving forward.

MICHAEL MOROZ is a College freshman and a co-chair of the College Republicans Editorial Board.